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Tuesday, May 3, 2011

Ethical issues in Marketing

The marketing department has compiled a detailed list of physicians who have prescribed similar products marketed by other drug companies. They want to target these physicians with dinners, free samples and free Drug Corp. merchandise in hopes of the doctors prescribing itgrowzhair to their patients.

a.Would you approve the suggested approach?

§No! I would not approve the suggested approach

b.Why?

a.Though the US food and drug Administration recently approved the sale and use of itgrowzhair however, it is not reasonable and logical to target those physicians who have prescribed similar products marketed by other drug companies and offer dinners, free samples and free Drug in hopes of the doctors prescribing itgrowzhair to their patients because sampling is not effective in improving drug access for the indigent, does not promote rational drug use, and raises the cost of care.The samples that drug representatives offer are almost never time-worn and well-tested drugs, nearly never generics, and usually comprise the newest agents on the market. As such, they expose patients to risks not yet identified in clinical trials. Samples have a major influence on physicians' prescribing habits.It is also true that the availability of samples might even influence physicians to prescribe drugs that would not otherwise be their top choice. Samples raise the cost of health care, as companies recoup marketing costs through higher prices and increased sales volume. Samples constitute an enormous promotional outlay of pharmaceutical companies. Not only this but also, free samples has negative effect on treatment decisions and most doctors' failure to fill out the cumbersome paperwork required when they dispensed drugs.

c.Legal consideration

a.The samples that drug representatives offer are almost never time-worn and well-tested drugs, nearly never generics, and usually comprise the newest agents on the market. As such, they expose patients to risks not yet identified in clinical trials. Therefore, from legal stand point it is not good to provide free drug samples to doctors as it manipulate the doctor’s prescription to the patients.

d.Ethical consideration

In an attempt to gain large market shares, pharmaceutical companies use doctors by providing free drug samples and other gifts for medical information dissemination, creating enormous endorsement bias, and ultimately placing patients at the mercy of these manipulation tactics. This obviously is not good from ethical standpoint. For example, if the relationship between the drug representative and clinician is severely biased, either through close friendship or substantial financial incentive, the clinician may feel compelled to use his or her position of authority to override patient preference.

2.They want to run national television ads directly to consumers for the product claiming that it has a “proven record of re-growing hair in many instances.”

a.Would you approve the suggested approach?

i.I would approve the suggested approach.

b.Why?

c.Because, Itgrowzhair has been proven in clinical trials to re grow hair for 25% of its users. Therefore, the statement “proven record of re-growing hair in many instances” is not entirely false argument. This statement is literally true but it is ambiguous and tendency to deceive consumers. Therefore, I would approve this approach taking the reference of our text book case “Pharmacia Corporation V. Glaxosmithkline Consumer Healthcare.

d.Legal consideration

i.According to the Federal Trade Commission (FTC), “advertising must be truthful and non-deceptive… advertisers must have evidence to back up their claims… and advertisements cannot be unfair.” Here in this particular scenario, itgrowzhair is already proved to re-grow hair for 25% of its users. Though, it does not say anything about what happened to the rest of the 75% of the users, it is not entirely misleading statement.

e.Ethical consideration

i.Market share concerns have too often tainted the purity of scientific inquiry. This has had profound effect on patient safety. Moreover, corporate sales tactics have replaced the better judgment and unbiased concerns physicians once had for their patients. Perhaps there will be power found in the increasing number of grass roots physicians who are choosing to stand against this type of influence. But until then, the current landscape, overshadowed by pharmaceutical big business is, at best, ethically suspect.

3.They also want to claim in their advertising that itgrowzhair has been shown to produce negative side effect in a “substantially lower number of users that the competitors product.” (Assume that this is true, but a major factor for this is because itgrowzhair has not yet been released widely to the public.

a.Would you approve the suggested approach?

i.I would not approve the suggested approach

b.Why?

i.According to advertising law, an advertisement is considered deceptive if it contains a statement or omits information that “is likely to mislead consumers acting reasonably under the circumstances; and is, ‘material’ - that is, important to a consumer's decision to buy or use the product.“ Essentially, the law states that the advertising should not be misleading. Advertiser has to tell the truth, or clearly label their ads so that no reasonable person could mistake the intent. Advertisers [and their advertising agencies] need to have a reasonable basis for advertising claims before they are published.But this advertisement is clearly misleading. There is no evidence to support their argument. It is not released widely to the public.

c.Legal consideration

i.In my opinion this advertisement is misleading and deceptive because there is omission and representation to mislead consumers acting reasonably under the circumstances. Another way of approaching the question of whether this advertising is misleading is to ask whether there are aspects of a product which if omitted from advertising, would result in consumers being misled. Like in this advertisement it says Itgrowzhair is better than the competitor’s product which is literally false because it is not released widely to the market.

d.Ethical consideration

i.The FDA requires that, if pharmaceutical company promotes the benefits of their medicine, they must also reveal any significant risks or side effects. But in this advertisement, the company says that itgrowzhair has been shown to produce negative side effect in a “substantially lower number of users than that of the competitor’s product.” This statement is literally false argument. This Advertisement is considered unethical because it has degraded or underestimated the substitute or rival's product and it gives false and misleading information on the value of the product.And it also fails to give useful information on the possible reaction or side effects of the product.

4.They also want to market the product to children in hopes that they will use it later in life by giving out free “it grow hair toupees”, which are funny wigs designed to make children’s hair look like that of famous celebrities. They plan to give these out at county fairs and lets kids order them online by visiting the drug corp. website.

a.Would you approve the suggested approach?

i.I would not approve the suggested approach

b.Why?

i.To build consumer trust advertisements must be truthful and fair. Children and other vulnerable groups must be advertised to with special care, as should alcoholic beverages, tobacco and other adult products. But in this case there is no point to target children as it an adult’s product.

ii.And because younger children do not understand persuasive intent in advertising, they are easy targets for commercial persuasion.

c.Legal consideration

i.The more fundamental concern regarding the effects of advertising on children relates to questions of potential harm resulting from exposure. A variety of research findings are relevant to this issue. Several studies, for example, have found that parent–child conflicts occur commonly when parents deny their children's product purchase requests that were precipitated by advertising.

d.Ethical consideration

i.Advertisers know that their efforts influence child audiences, and they put their money on the line in support of this assumption with the placement of every commercial message they buy. Advertising that is unfair or that promotes the use of harmful products does a disservice to children. Given the significant role played by advertiser-supported media in the lives of the nation's children, it is time to move forward with new policies that will better protect the interests of children.

ii.Advertisements should not encourage children to pester their parents to make them buy whatever they want;

iii.Advertisements for adult’s product like itgrowzhair should not be targeted towards children.

iv.This advertisement in particular is manipulative and misleading in nature because they want to market the product to children in hopes that they will use it later in life by giving out free “it grow hair toupees”, which are funny wigs designed to make children’s hair look like that of famous celebrities. They plan to give these out at county fairs and lets kids order them online by visiting the drug corp. website.

References

Halbert, J.D., Terry, Ingulli, ESQ., Elaine, (2006).Law And Ethics In The Business Environment : South Western Cengage Learning.